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November 6, 2014Client Alert

FCC Requires Solicited Faxes to Have Opt-Out Notices

The Federal Communications Commission (FCC) recently issued an Order attempting to clarify its requirement of opt-out notices on solicited faxes under the Telephone Consumer Protection Act (TCPA) and 2006 Junk Fax Order and also issued a retroactive waiver of its rule requiring that fax advertisements sent with prior consent include opt-out notices. The Order was issued in response to the significant amount of litigation and confusion resulting from apparent inconsistencies between the language of the TCPA, the FCC’s Junk Fax Order and a footnote contained in the Junk Fax Order. 

In 1991, Congress enacted the TCPA which prohibits the use of any fax machine, computer or other device to send and “unsolicited advertisement” to a fax machine. In 2005, Congress enacted the Junk Fax Prevention Act (JFPA), which amended the fax advertising provisions of the TCPA and required the sender of an unsolicited fax to provide an opt-out notice which would allow a recipient to opt-out of any future fax transmissions. In 2006, the FCC adopted the Junk Fax Order amending the JFPA to also require that a fax advertisement “sent to a recipient that has provided prior express invitation or permission to the send must include an opt-out notice.”  The Junk Fax Order sparked a flurry of litigation around the issue and prompted nearly two dozen petitions arguing that the FCC lacked authority to require opt-out notification of faxes sent with prior permission.

On October 30, 2014, the FCC ruled that companies must include information that will allow recipients to opt-out from further distributions on all faxes they send, even those that consumers have agreed to receive. The notices must conform to the rules adopted by the Junk Fax Order, including that the notice must be clear and conspicuous and on the first page of the ad. 

In doing so, the FCC rejected arguments that it lacked statutory authority to require opt-out information on solicited ads and confirmed that section 227(b) of the TCPA was the basis for the opt-out requirement even though, as the dissenting commissioners noted, the TCPA uses the phrase “unsolicited advertisement” nine separate times in describing the opt-out notice of section 227(b). The Order also acknowledged that “a number of parties” may have been reasonably uncertain about the requirement for opt-out notices due to a footnote in the Junk Fax Order that stated that the requirement “only applies to communications that constitute unsolicited advertisements” and the lack of an explicit statement in the commission’s public notice that the requirement applied to solicited faxes. 

This conclusion led the commission to grant retroactive waivers of the opt-notice requirement to several petitioners whose requests led to the FCC Order, as well as others similarly situated.  Accordingly, parties who have sent solicited faxes without a proper opt-out notice or any opt-notice at all may seek retroactive waiver from the FCC. The waivers are effective for up to six months after the issuance of the FCC Order. As such, by April 30, 2015, senders of fax advertising will need to be in strict compliance with the opt-out provisions as interpreted by the FCC.

 

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